Why Jay Z's New Venture Fund Should Come As No Surprise

Another Reason To Smile: Jay Z, seated with daughter Blue Ivy and wife Beyoncé at the NBA All-Star Game, is launching his own venture fund. (Photo by Theo Wargo/Getty Images)

Jay Z has decided to start a venture capital fund that will target seed-stage tech startups, according to a report released earlier today. The mogul is said to be partnering with Jay Brown, the president of Roc Nation, and Sherpa Capital, the firm cofounded by FORBES cover star Shervin Pishevar.

The news has already ricocheted around the internet, drawing breathless commentary--but it should come as no surprise. Jay Z has been investing in startups for quite some time, and his partners are familiar faces.

Brown has worked with Jay Z for years and is one of the driving forces in his inner circle. Pishevar has invested with Jay Z on startups including Blackjet, the Uber-for-private-planes app that crashed and burned three-and-a-half years ago. (Jay Z recently invested in a similar company, JetSmarter, along with members of the Saudi royal family).

Jay Z has had more success with venture adventures such as Tidal, the Scandinavian streaming service he purchased for $56 million two years ago. Sprint recently poured $200 million into the company and made hefty annual funding guarantees in exchange for a one-third stake, valuing Tidal at $600 million, a tenfold gain on paper.

Technically, Jay Z has been investing in startups for his entire career. He poured his own illicit gains into Roc-A-Fella Records in the mid-1990s along with cofounders Damon Dash and Kareem "Biggs" Burke and sold it to Def Jam across multiple deals following the release of his debut, Reasonable Doubt. The trio also launched clothing line Rocawear, which was sold to Iconix for $204 million in 2007.

Jay Z has separately invested in an array of entities, from the NBA's Nets to the pricey champagne Armand de Brignac. He has boosted those holdings and others by mentioning them in songs and featuring them in videos. It remains to be seen if this model will hold as he expands his portfolio into more esoteric tech startups.

Representatives for Jay Z and Pishevar did not immediately return requests for comment.